The Central Bank incoming governor, Gabriel Makhlouf, is understood to have assured Minster for Finance Paschal Donohoe, when they met in person for the first time last week, that he will address his controversial handling of a security breach in New Zealand when he takes office in September.
Mr Makhlouf, a former UK civil servant who was hired in 2011 to head New Zealand’s treasury department, claimed in his last weeks in office in May that the ministry’s IT system had been deliberately and systematically hacked, resulting in the lead of sensitive budget information.
However, it later emerged that the information had been published on the ministry’s website and could be accessed using a search function. New Zealand’s public service watchdog concluded at the end of June that Mr Makhlouf sought to blame others and managed the incident poorly.
Treasury issue
Mr Makhlouf, who was born in Egypt to a Cypriot-British father and Greek Armenian mother, met Mr Donohoe for the first time in Dublin last Thursday, a spokesman for the Department of Finance confirmed to The Irish Times. He declined to comment on what was discussed.
However, it is understood that the one-time senior UK tax official promised to address the New Zealand treasury issue when the takes up his new role at the start of September.
Mr Makhlouf also paid a visit to the Central Bank’s headquarters when he was in Dublin last week seeking to organise accommodation for when he takes over the helm the 76-year-old institution, according to sources.
‘Highest calibre’
Mr Donohoe said earlier this month that he had engaged directly – but not in person – with Mr Makhlouf “both during the recruitment process and the aftermath of it”, and that he regarded the incoming Central Bank governor to be “a public servant of the highest calibre”. However, he said that he expected Mr Makhlouf to make a statement on the New Zealand controversy before taking office.
Mr Makhlouf, a one-time principal private secretary to Gordon Brown, when the latter was the UK chancellor of the exchequer, was unveiled as the Republic's 12th Central Bank governor in early May, in succession to Philip Lane.
Mr Lane has since become the European Central Bank’s chief economist. Mr Makhlouf’s role as Central Bank of Ireland governor will give him a seat at the ECB’s governing council, which sets monetary policy for the euro zone, alongside his predecessor.
